NEW YORK - Wall Street drifted in quiet trading Wednesday after its huge rally a day earlier, as investors awaited an afternoon decision on interest rates from the Federal Reserve. The major indexes alternated between gains and losses.

The market expects policymakers to lower the fed funds rate, which stands at 1.5 percent, by a half point or three-quarters of a point, though there has been speculation that smaller or wider cuts are possible.

The only certainty is that Wall Street will pore over the Fed's statement on its decision and its reading of the economy. That assessment, along with any move on rates themselves, could lead the market to retreat, rally or simply shrug off a move that it writes off as expected.

Stocks' fluctuations were not surprising given the light trading volumes and the 889-point advance logged by the Dow Jones industrials Tuesday. The Dow and the Standard & Poor's 500 index posted gains of nearly 11 percent, while the Nasdaq composite index rose 9.5 percent as investors, confident about the prospects for a rate cut, piled into the market to pick up stocks that have become bargains.

The Dow's gain was its second-largest daily point gain; the biggest was its 936-point surge on Oct. 13 that later evaporated as fears about the economy grew. The stock market has been extremely volatile lately - beyond a simple case of investor indecision, the market's back-and-forth moves may also be part of its attempt to establish a bottom.

"What we're doing today is waiting," said David Reilly, director of portfolio strategy at Rydex Investments. "The market is not doing much of anything, which I guess is to be expected after a day like yesterday."

He contends the market likely won't react wildly if the Fed's move largely meets expectations but said a smaller rate cut could alarm Wall Street.

"Anything less than a 50 basis point (0.5 percentage point) cut I think would be nothing short of calamitous," Reilly said.

In late morning trading, the Dow fell 11.87, or 0.13 percent, to 9,063.25 after rising in earlier trading.

Advancers outnumbered decliners by about 3 to 2 on low volume of 433.7 million shares on the New York Stock Exchange.

A surprise gain in orders for big-ticket manufactured goods did little to galvanize the market. The Commerce Department said orders for durable goods - items such as cars, appliances and machinery expected to last at least three years - rose 0.8 percent in September after tumbling 5.5 percent in August. Orders were expected to have fallen by 1.5 percent.

The modest rebound in durable goods was welcome news, but not enough to erase Wall Street's concerns about the economy.

The three major stock indexes are still down more than 30 percent for the year, battered since last month's freeze-up of the credit markets. The troubles with the credit markets have made it harder and more expensive for businesses and consumers to get loans.

Moves by hedge funds and mutual funds to exit positions have added to the market's volatility, analysts say, adding that the market likely won't have a sustained recovery until some big players halt more of their selling.

While signs have emerged that the government action to revive credit markets is starting to work, investors remain skittish over the effects of the prolonged credit freeze on the economy, which relies on lending to feed growth.

Investors are hoping a rate cut by the Fed, expected Wednesday afternoon, would complement the government's still-unfolding efforts to aid the commercial paper market, where companies turn for short-term loans, and the banks themselves. The Treasury this week is investing directly in banks, hoping the cash will make them more likely to issue loans.

Meanwhile, investors examined demand for government debt. The yield on the three-month Treasury bill, regarded as the safest investment around and an indicator of investor sentiment, fell to 0.67 percent from 0.74 percent Tuesday. A drop in yield indicates an increase in demand. Meanwhile, the yield on the benchmark 10-year Treasury note was at 3.84 percent, the same as late Tuesday.

Light, sweet crude rose $5.22 to $67.95 a barrel on the New York Mercantile Exchange.